Leases

3 Months Ended

Mar. 31, 2023

Leases [Abstract]

Leases

Leases

Lessor Accounting

We lease communications towers, ground space, colocation space and dark fiber to tenants under operating leases. Our leases have initial lease terms ranging from less than one year to 35 years, most of which include options to extend or renew the leases for less than one year to 20 years (based on the satisfaction of certain conditions as defined in the lease agreements), and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

The components of lease income for the three months ended March 31, 2023 and 2022 respectively, are as follows:

	Three Months Ended March 31,
(Thousands)	2023		2022
Lease income - operating leases	$	231,920	$	221,565

Lease payments to be received under non-cancellable operating leases where we are the lessor for the remainder of the lease terms as of March 31, 2023 are as follows:

(Thousands)	March 31, 2023⁽¹⁾
2023	$	583,407
2024	797,561
2025	799,672
2026	801,051
2027	801,727
Thereafter	2,318,910
Total lease receivables	$	6,102,328
(1) Total future minimum lease payments to be received include $5.2 billion relating to the Windstream Leases.

The underlying assets under operating leases where we are the lessor are summarized as follows:

(Thousands)	March 31, 2023		December 31, 2022
Land	$	26,549	$	26,549
Building and improvements	346,636		346,093
Poles	299,799		296,941
Fiber	3,638,160		3,529,835
Equipment	437		437
Copper	3,972,704		3,964,439
Conduit	89,963		89,963
Tower assets	1,397		1,397
Finance lease assets	28,126		28,126
Other assets	10,434		10,434
	8,414,205		8,294,214
Less: accumulated depreciation	(5,586,881)		(5,542,726)
Underlying assets under operating leases, net	$	2,827,324	$	2,751,488

Depreciation expense for the underlying assets under operating leases where we are the lessor for the three months ended March 31, 2023 and 2022, respectively, is summarized as follows:

	Three Months Ended March 31,
(Thousands)	2023		2022
Depreciation expense for underlying assets under operating leases	$	45,206	$	43,187

Lessee Accounting

We have commitments under operating leases for communications towers, ground space, colocation space, dark fiber and buildings. We also have finance leases for dark fiber and automobiles. Our leases have initial lease terms ranging from less than one year to 30 years, most of which include options to extend or renew the leases for less than one year to 20 years, and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

As of March 31, 2023, we have short term lease commitments amounting to approximately $3.1 million.

Future lease payments under non-cancellable leases as of March 31, 2023 are as follows:

(Thousands)	Operating Leases		Finance Leases
2023	$	12,340	$	2,103
2024	14,031		2,616
2025	11,346		2,562
2026	8,663		2,562
2027	6,103		2,444
Thereafter	45,502		12,708
Total undiscounted lease payments	$	97,985	$	24,995
Less: imputed interest	(33,940)		(8,809)
Total lease liabilities	$	64,045	$	16,186

Leases

Leases

Lessor Accounting

We lease communications towers, ground space, colocation space and dark fiber to tenants under operating leases. Our leases have initial lease terms ranging from less than one year to 35 years, most of which include options to extend or renew the leases for less than one year to 20 years (based on the satisfaction of certain conditions as defined in the lease agreements), and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

The components of lease income for the three months ended March 31, 2023 and 2022 respectively, are as follows:

	Three Months Ended March 31,
(Thousands)	2023		2022
Lease income - operating leases	$	231,920	$	221,565

Lease payments to be received under non-cancellable operating leases where we are the lessor for the remainder of the lease terms as of March 31, 2023 are as follows:

(Thousands)	March 31, 2023⁽¹⁾
2023	$	583,407
2024	797,561
2025	799,672
2026	801,051
2027	801,727
Thereafter	2,318,910
Total lease receivables	$	6,102,328
(1) Total future minimum lease payments to be received include $5.2 billion relating to the Windstream Leases.

The underlying assets under operating leases where we are the lessor are summarized as follows:

(Thousands)	March 31, 2023		December 31, 2022
Land	$	26,549	$	26,549
Building and improvements	346,636		346,093
Poles	299,799		296,941
Fiber	3,638,160		3,529,835
Equipment	437		437
Copper	3,972,704		3,964,439
Conduit	89,963		89,963
Tower assets	1,397		1,397
Finance lease assets	28,126		28,126
Other assets	10,434		10,434
	8,414,205		8,294,214
Less: accumulated depreciation	(5,586,881)		(5,542,726)
Underlying assets under operating leases, net	$	2,827,324	$	2,751,488

Depreciation expense for the underlying assets under operating leases where we are the lessor for the three months ended March 31, 2023 and 2022, respectively, is summarized as follows:

	Three Months Ended March 31,
(Thousands)	2023		2022
Depreciation expense for underlying assets under operating leases	$	45,206	$	43,187

Lessee Accounting

We have commitments under operating leases for communications towers, ground space, colocation space, dark fiber and buildings. We also have finance leases for dark fiber and automobiles. Our leases have initial lease terms ranging from less than one year to 30 years, most of which include options to extend or renew the leases for less than one year to 20 years, and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

As of March 31, 2023, we have short term lease commitments amounting to approximately $3.1 million.

Future lease payments under non-cancellable leases as of March 31, 2023 are as follows:

(Thousands)	Operating Leases		Finance Leases
2023	$	12,340	$	2,103
2024	14,031		2,616
2025	11,346		2,562
2026	8,663		2,562
2027	6,103		2,444
Thereafter	45,502		12,708
Total undiscounted lease payments	$	97,985	$	24,995
Less: imputed interest	(33,940)		(8,809)
Total lease liabilities	$	64,045	$	16,186

Leases

Leases

Lessor Accounting

We lease communications towers, ground space, colocation space and dark fiber to tenants under operating leases. Our leases have initial lease terms ranging from less than one year to 35 years, most of which include options to extend or renew the leases for less than one year to 20 years (based on the satisfaction of certain conditions as defined in the lease agreements), and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

The components of lease income for the three months ended March 31, 2023 and 2022 respectively, are as follows:

	Three Months Ended March 31,
(Thousands)	2023		2022
Lease income - operating leases	$	231,920	$	221,565

Lease payments to be received under non-cancellable operating leases where we are the lessor for the remainder of the lease terms as of March 31, 2023 are as follows:

(Thousands)	March 31, 2023⁽¹⁾
2023	$	583,407
2024	797,561
2025	799,672
2026	801,051
2027	801,727
Thereafter	2,318,910
Total lease receivables	$	6,102,328
(1) Total future minimum lease payments to be received include $5.2 billion relating to the Windstream Leases.

The underlying assets under operating leases where we are the lessor are summarized as follows:

(Thousands)	March 31, 2023		December 31, 2022
Land	$	26,549	$	26,549
Building and improvements	346,636		346,093
Poles	299,799		296,941
Fiber	3,638,160		3,529,835
Equipment	437		437
Copper	3,972,704		3,964,439
Conduit	89,963		89,963
Tower assets	1,397		1,397
Finance lease assets	28,126		28,126
Other assets	10,434		10,434
	8,414,205		8,294,214
Less: accumulated depreciation	(5,586,881)		(5,542,726)
Underlying assets under operating leases, net	$	2,827,324	$	2,751,488

Depreciation expense for the underlying assets under operating leases where we are the lessor for the three months ended March 31, 2023 and 2022, respectively, is summarized as follows:

	Three Months Ended March 31,
(Thousands)	2023		2022
Depreciation expense for underlying assets under operating leases	$	45,206	$	43,187

Lessee Accounting

We have commitments under operating leases for communications towers, ground space, colocation space, dark fiber and buildings. We also have finance leases for dark fiber and automobiles. Our leases have initial lease terms ranging from less than one year to 30 years, most of which include options to extend or renew the leases for less than one year to 20 years, and some of which may include options to terminate the leases within one to six months. Certain lease agreements contain provisions for future rent increases. Payments due under the lease contracts include fixed payments plus, for some of our leases, variable payments.

As of March 31, 2023, we have short term lease commitments amounting to approximately $3.1 million.

Future lease payments under non-cancellable leases as of March 31, 2023 are as follows:

(Thousands)	Operating Leases		Finance Leases
2023	$	12,340	$	2,103
2024	14,031		2,616
2025	11,346		2,562
2026	8,663		2,562
2027	6,103		2,444
Thereafter	45,502		12,708
Total undiscounted lease payments	$	97,985	$	24,995
Less: imputed interest	(33,940)		(8,809)
Total lease liabilities	$	64,045	$	16,186